This application relates generally to derivative transactions. More specifically, this application relates to methods and systems for implementing derivative transactions.
As used herein, references to a “derivative transaction” are intended to refer to a transaction derived at least in part from another transaction that may be executed in the future. Execution of derivative transactions generally take the form of execution of an underlying contract between two parties. One example of a derivative transaction is a “futures transaction,” which is intended to refer herein to a transaction based on a futures contract between two parties specifying a date and certain terms for execution of the futures contract. Another example of a derivative transaction is an “option transaction,” which is intended to refer herein to a transaction based on an option contract between two parties securing the right of at least one of the parties to execute a defined transaction.
The derivatives market has developed a great deal of complexity and is most often associated with relatively sophisticated investment strategies. Relatively few individual consumers and small business make practical use of the underlying derivatives as a mechanism for managing costs in a predictable way. Yet this ability is a primary benefit of the derivatives themselves. The very complexity associated with managing derivatives has acted as a barrier to their practical use by individuals and small businesses. The result has been the development of system that is generally more concerned with the trade of derivatives and how profit may be generated by their purchase and sale, rather than their use as cost-management instruments.
There is accordingly a general need in the art for methods and systems for implementing derivative transactions that provide more convenience and ease of execution and use.